On the level playing field, alternative providers have been backed into a corner

The Higher Education and Research Act 2017 was supposed to usher in a new wave of alternative providers by providing a level playing field – but evidence has shown that this has not come to pass.

That’s the headline and the accepted truth, but having worked in an AP for almost a year, I have some thoughts on why. To begin with, there are 813 alternative providers teaching 58,735 students. So we do exist – you just might not have heard of us.

They’re off

A recent report suggests that half of alternative providers exit the sector in three years. GSM was the one of the highest profile closures and was an alternative provider, with headlines about the amount of public money that was given to it. It may soon be followed by Richmond the American University in London, an Alternative Provider with TDAPs. So market exit appears to be taking shape – but what’s stopping the increase in market entry?

The aim of the OfS regime was to reduce burdens by focusing on outcomes and not processes – but it;’s not at all clear that that is what has happened. As OfS’ registration process rumbles on (a procedural process by anyone’s standards), notably it is smaller APs who are being added to the register at this late stage.

As OfS’ own report on the process says, “it was clear that a number of providers were not ready to be regulated”. That all but 12 providers have received some form of intervention as a result of the process either suggests that the UK’s higher education isn’t the gold standard we like to think it is, or that the process itself is unduly complicated and burdensome and, arguably, goes beyond the “student interest”.

Student Protection Plans are worth highlighting as a point of contradiction in the OfS report. It both argues that “no provider has been registered if we were not confident that the initial conditions of registration were satisfied” and also that 266 providers are being asked to resubmit plans and were registered anyway as “it would not have been in the interests of students to delay registration in so many cases.”

Neither in nor out

We are in something of an in-between stage. A number of providers have applied for registration whose outcomes are not publicly known and who have received limited designation. This doesn’t inspire rigour in the system or process, particularly as GSM wasn’t registered with OfS and so had no published Student Protection Plan to manage their market exit. As HESA’s latest data release shows, this “limbo” appears to be affecting a growing number of students.

Until now APs were required to submit an Alternative Provider data return to HESA which will soon be named Student Alternative, a sort of sub-section of the student return. APs will soon be subject to HESA’s Data Futures programme just like other providers. For most APs, this work falls to an individual and so increasing returns to four times a year doesn’t sound like a lower burden – let alone the uncertainty over when exactly we’ll be getting it.

Another barrier to market entry is cost. Providers now have to pay for the privilege of being regulated, and as noted elsewhere on Wonkhe the cost is higher per student for APs. Add into that the cost of rising HESA subscriptions, QAA and OIA and you have a significant bill.

This isn’t to say that we haven’t seen some levelling – APs are now being granted track record status and so access to the same privileges as other Tier 4 sponsors when it comes to international students. Though do spare a thought for those providers who offer Trinity Level 3 Diplomas, who having operated under the Ofsted regime for years have been told they’re suddenly operating in an HE environment – and need to be OfS registered to sponsor Tier 4 students, with all of the additional requirements outlined above.

We all accept that we are living in turbulent times, particularly in the higher education sector, so let’s wait until the dust settles before we give up on market entry – although it may be given some of the challenges below that the level playing field is an ideal that we may never meet.

Around the nations

Higher education remains devolved between the different nations – and while the majority of APs operate in England this does still have ramifications. Take student finance for a practical example – under HERA there is no difference between approved providers and approved (fee cap) providers, as they’re both “approved”. Before now APs didn’t have access to the Course Management System to update our student finance information each year. Instead we would send the information to student finance for them to upload, which memorably took longer than it should have (which on one occasion wasn’t helped by student finance telling students and their parents that we hadn’t updated our information).

The next catch is that HERA applies to England only, so we have to apply for designation separately for our courses to be eligible for Welsh students. That’s a process that involves sending HEFCW a lot of the same information required by OfS, such as financial accounts and statements on public benefit. Oh – and Northern Ireland don’t currently designate postgraduate courses offered by APs.

It’s often the case that legislation is enacted piecemeal, but for all the discussion on creating a level playing field we’re not quite there yet, and perhaps we never will be. It puts IndependentHE’s calls for an SME Manifesto for Higher Education, which specifically calls for start-up loans and SME Impact Assessments for regulation, into context. If we really want a diverse sector, OfS’ review of “burdens” can’t come soon enough.